The Treasury Department loaned the U.S. Postal Service $10 billion in emergency coronavirus relief funding in late July of 2020 in exchange for proprietary information about the mail service’s most lucrative private-sector contracts.
At this time, three months before the election, the post office has $14 billion cash on hand which is enough money to sustain the agency through October 2021.
The Postal Service, subject to confidentiality restrictions, will provide Treasury copies of its 10 largest “negotiated service agreements,” or contracts with high-volume third-party shippers such as Amazon, FedEx and UPS, and receive a crucial injection of cash that postal officials say will keep the debt-laden agency solvent for at least another year, according to a copy of the loan’s term sheet obtained by The Washington Post.
The Postal Service contracts with private-sector shippers for “last-mile” delivery from distribution centers to consumers’ homes, and it offers those companies small discounts because of the volume of packages they provide.
Democrats were encouraged by the Postal Service reporting better-than-expected financial results in May. The black ink is attributed to surging package volume which is eclipsing Christmastime levels. Again, currently, the USPS now has close to $15 billion in cash on hand, so it is in no need of a bailout.
The loan from Treasury will buy the Postal Service at least five more months of liquidity, but perhaps as much as a year’s more cash if package revenue continues to make up for declines in first-class mail, the agency’s most profitable product.
The president says he wants to fix the post office and make it profitable. USPS has lost $69 billion over the past 11 fiscal years—including $3.9 billion in fiscal year 2018.
Chief of Staff Mark Meadows says President Trump will sign a bill that includes additional funding for the Postal Service if Democrats negotiate a new stimulus bill.
Meadows added that sorting machines will not be taken off-line between now and the election. There were reports that 10% of machines were being decommissioned.
The Postal Service processes and delivers 472.1 million mail pieces each day, so it should be able to handle an additional 100 million ballots over a month’s time.